Tonia Novitz

An emergent trade in services is challenging the standard application of transnational labour laws promulgated by the International Labour Organisation (ILO) and the European Union (EU). This chapter considers who benefits from this shift in orientation. It begins by considering past linkages between trade in goods and the establishment of transnational labour standards predominantly by high-income industrialised states in the North. The second part of the chapter then goes on to examine the current scope for protection of labour standards where there is trade in services, exploring a tendency towards commodification of labour in this sphere. Two specific settings are examined: the movement of natural persons under ‘mode 4’ of the General Agreement on Trade in Services (GATS) and EU ‘posted work’ which accompanies the exercise by employers of their entitlement to free movement of services between EU Member States. The scope for renegotiation of labour norms might, at least superficially, appear to open up possibilities for lower-income States to engage politically where they were once absent. This could be a turn of events which has deliberative potential and it is certainly worth exploring more fully how such renegotiation around service provision could be beneficial to developing and emerging economies in the South. However, the development benefits may be illusory. The main drivers of change appear to be higher-income States (for whom the services industry constitutes an estimated 70–80 per cent of output and employment) and multinational corporations based in the North (eager to expand service markets and utilise cheaper labour). The impoverished workers and low-income States each remain largely excluded from the benefits of trading in services.